The High Court has put a 14-day stay on an order requiring Dublin Waterworld Ltd to hand over possession of the €62 million National Aquatic Centre. It has also directed Dublin Waterworld to pay most of the legal costs, which could be more than €2 million, of the action to recover possession of the centre.
Dublin Waterworld has appealed to the Supreme Court against the High Court order directing it to hand over possession of the centre on Friday next to Campus and Stadium Ireland Development Ltd. The appeal has yet to be heard.
Yesterday, Hugh O'Neill SC, for Dublin Waterworld, asked Mr Justice Paul Gilligan to grant a stay on that order for possession pending the outcome of the Supreme Court appeal. Without a stay, the appeal was effectively moot as Dublin Waterworld would already have surrendered possession on Friday, counsel said.
Denis McDonald SC, for Campus and Stadium Ireland, said his side was strongly opposed to any stay.
The judge accepted that if no stay was granted the matter was effectively over and said he would, in those circumstances, place a 14-day stay on the order for possession, which would operate from April 28th. However, he directed, any application for a further stay pending the outcome of the appeal was a matter for the Supreme Court.
The judge also ordered Dublin Waterworld to pay Campus and Stadium Ireland the costs of 18 days of the 22-day hearing of the proceedings. He deducted four days costs, saying these were incurred as a result of Campus and Stadium Ireland making a substantial amendment to its statement of claim, which amendment, he was satisfied, should have been effected at an earlier stage.
Undertakings by Dublin Waterworld to continue operating the centre, not to remove any plant or equipment from the centre and to retain membership and other records relevant to the centre are to continue, the judge directed.
Campus and Stadium Ireland had brought the action against Dublin Waterworld, a shelf company with no assets and registered offices at Ballyvard, Tralee, Co Kerry, alleging several breaches of the lease for operating the centre.
In a reserved judgment last month, Mr Justice Gilligan ruled that Campus and Stadium Ireland was entitled to an order for possession of the National Aquatic Centre because of "wilful" breaches of the lease both by Dublin Waterworld and Limerick businessman Pat Mulcair, including failure to pay more than €11 million due in rent and VAT. Because of those breaches and the breakdown of trust, the judge said that the 30-year lease, granted to Dublin Waterworld in controversial circumstances three years ago, is forfeit.
He noted Campus and Stadium Ireland had said it has "contingency plans" for the centre in the event of an order for possession being made.
Dublin Waterworld secured the lease on April 30th, 2003. The judge found that, in a deal done "behind the back" of Campus and Stadium Ireland just hours earlier that same day, Dublin Waterworld breached the terms of the lease by assigning beneficial ownership of it to Mr Mulcair, who in turn entered into a management agreement with Dublin Waterworld Management Ltd (DWML) - a wholly owned subsidiary of Dublin Waterworld Ltd - whereby DWML would manage the centre on Mr Mulcair's behalf.
The judge noted the funding arrangements with Mr Mulcair, described as a "tax-driven deal", could be terminated if substantial capital allowances, worth some €2.8 million a year and capped at €34 million, were not secured by Mr Mulcair.
This would have left Dublin Waterworld Ltd without a venture capital provider for the centre, he said.
In March 2005, Campus and Stadium Ireland served a notice for forfeiture of the lease on grounds of multiple breaches of its terms and High Court proceedings were brought.
After Campus and Stadium Ireland took legal proceedings, rent was paid up to date and other payments were also made.